Could Japan be a Model for a Post-Growth Economy?

17102010

The New York Times launched a series of articles examining the effects on Japanese society of two decades of economic stagnation and declining prices. I am interested in this series for clues on what a post-growth economy could look like.

There are many comments and descriptions in the article that shatter accepted icons of what we believe to be fundamentals to economic growth. For example:

The younger generation in Japan — people who have known nothing of Japan’s super prosperous times of the ’70s and ’80s — is devoutly ANTI-consumption. They buy clothes at discount stores, don’t travel abroad and think spending in general is stupid.

Young Japanese men are called “herbivores,” meaning that they don’t have the will to succeed and work for long hours that their fathers did. In other words, a special kind of manhood is seen as necessary for economic growth.

A Japanese economist wishes inflation would return because it is the engine for “creative destructionism,” a reference to Joseph Schumpeter’s famous praise for entrepreurialism. Today’s deflationary environment, he says, is “just destructive destructionism.”

I believe that we face an imperative to go, in the words of Herman Daly, “beyond growth.” This means not consuming more than can naturally be regenerated. It means not having an inflationist economic system where debt-based money requires prices and output to either (a.) rise exponentially or (b.) have the whole whole economic edifice collapse. It means getting away from conceptions of wealth being tied to masculine power.

The deflation besetting Japan could be seen as a glass half full, not empty, in showing what a post-growth society could be.